A series of market records were broken in July as average rent costs soared, according to data from the latest Goodlord Rental Index.
The average rent of a property in England is now £1,470. This is up by 7.5% year-on-year, surging past what some market watchers believed could be the ‘ceiling’ on rental costs set in summer 2023. In July last year, the average price of a rental property in England was £1,367.
Regionally, the biggest year-on-year increase was recorded in the South West, where rents are now 10% higher than they were a year ago. The smallest move was seen in the West Midlands, where rents are up by a relatively modest 4% compared to July 2023.
Month-on-month – between June and July 2024 – there was a huge 20% increase in rents across England. Driven by soaring summer demand, rents jumped up from £1,225 per property in June to the £1,470 average of July.
Two regions saw a staggering increase in rents for new tenancies in July versus the previous month, with July rents jumping over 40% compared to June in both the North West and South West.
Elsewhere, the East Midlands and North East saw demand drive month-on-month costs up by more than 20%.
The smallest changes were seen in Greater London (5%+) and the West Midlands (3%+)
Voids drop markedly
Void periods shortened from 17 days in June to just 11 days in July across England – a reduction of 35%.
The shortest voids can now be found in the North West, at just five days (down from 17) and the South West, at just seven days (down from 11). Both regions recorded the biggest increases in rental costs over the month. Voids are now at a 12-month low.
However, voids are still tracking slightly longer year-on-year. In July 2023, the average void period was even shorter, at nine days.
Increased tenant income
Facing escalating rental costs, one factor that may soften the blow slightly for tenants is pay.
The Index recorded a rise in salaries for renters signing new tenancy contracts in July, with average pay up from £36,800 in June to £38,086 in July. This is a rise of 3.5%, although it lags significantly behind the month-on-month increase in rental costs.
Commenting on the latest data Goodlord chief executive William Reeve said: “These July figures show another remarkable increase in rents. We’ve become used to seeing steady year-on-year increases since 2020, but there were indications that the striking numbers set last summer might start to level off. This argument has been dramatically disproven.”
He added: “ July’s figures have smashed rental price records and set a new baseline for the market’s busiest months. At the same time, voids have notably shortened, further highlighting the squeeze on supply. For tenants, the new government’s moves to accelerate house building can’t come soon enough.”
